COVENTRY City last night sensationally put part of the club into administration on the eve of a crucial High Court hearing.
The sky Blues released a statement claiming that Coventry City Football Club Ltd was now in administration * but Coventry City Football Club (Holdings) Ltd would continue as the club's trading arm.
It was claimed the club will argue with the Football League that this should avoid the ten-point deduction in League one this season.
However, a similar argument put forward by southampton FC when it put its holding company into administration was rejected by the Football League, suggesting that the sky Blues are still likely to face a point deduction, effectively ending their play-off dream.
Last night the Football League declined to comment on the situation although it is likely that ricoh arena's operating company arena Coventry Ltd (aCL) will be looking for urgent clarification today as to the Football League's position on the latest move by the club's owner sisu.
and in a further development it was rumoured last night that the move could have ended the club's tenure at the ricoh with the club playing its last game at the stadium, fulfilling the rest of this season's fixtures else where, possibly at Walsall's Bescot stadium.
The football club's state ment in full read: “Coventry City Football Club Holdings can confirm that a non-operating subsidiary of the Club has today been placed into administration.
“It is important to stress that the football club itself is not under threat. Thi is merely a property subsidiary which owns no material assets and has no employees, on or off the pitch.
“The Club can c confirm that all staff wages, Paye and all other creditor commitments will continue to be met as before by Coventry City Foot ball Club Holdings.
“Unlike other instances of clubs being taken either wholly or partially into ad ministration, there are no HMrC or VaT implications and the Football Club will continue to trade as normal without interruption.
“our main objective now is to remain competitive on the pitch and give steven Press ley and the playing staff our full backing and commitment.“
The eleventh-hour move was intended to prevent aCL succeeding in its High Court bid to force the sky Blues into administration over £1.3million rent arrears * a hearing that is still set to take place today in some form.
aCL, in applying to the High Court for an administration order on the football club, had said the move could force a takeover of the club * forcing out its hedge fund owners sisu. d owners sisu.
aCL * jointly owned Coven try City Coun cil and the alan edward t Higgs Chari ty * had lined up Brendan Guilfoyle, of sheffieldbased P&a Partrship to take nership to take over the running of the club but the club last night appointed rubin & Partners as its administrator instead.
It is understood that it was able to do this after a “qualifying floating charge“ was put in place last March by sisu's Cayman Island-based subsidiary arvo Master Fund, the vehicle through which investment was made into the club, effectively making it the club's main creditor. speaking last night, Mr Guilfoyle said: “I'm being proposed as the administrator by aCL at a hearing tomorrow, but there is a possibility that arvo Master Fund Ltd may appoint an administrator of their choice.“
If aCL successfully challenges the latest legal move and is able to put the whole club into administration, Mrs Justice Proudman would first need to rule the club is insolvent and it is known that the club has been running at a loss for a number of years.
Many fans fear the club's entire future is at stake * with liquidation suggested two weeks ago by sky Blues chief executive Tim Fisher.
Today's hearing brings to a head a year-long dispute since the sky Blues began refusing to pay monthly £100,000 rental payments last april.
Talks over sisu acquiring stadium part-ownership collapsed months ago when the council in January bought out aCL's mortgage with yorkshire Bank to prevent the sky Blues' rent withdrawal pushing aCL towards administration.
aCL formally ended negotiations last month with sisu over a final offer to cut the £1.2million annual rent to £400,000, and pay back rent arrears over several years.
The sky Blues released a statement claiming that Coventry City Football Club Ltd was now in administration * but Coventry City Football Club (Holdings) Ltd would continue as the club's trading arm.
It was claimed the club will argue with the Football League that this should avoid the ten-point deduction in League one this season.
However, a similar argument put forward by southampton FC when it put its holding company into administration was rejected by the Football League, suggesting that the sky Blues are still likely to face a point deduction, effectively ending their play-off dream.
Last night the Football League declined to comment on the situation although it is likely that ricoh arena's operating company arena Coventry Ltd (aCL) will be looking for urgent clarification today as to the Football League's position on the latest move by the club's owner sisu.
and in a further development it was rumoured last night that the move could have ended the club's tenure at the ricoh with the club playing its last game at the stadium, fulfilling the rest of this season's fixtures else where, possibly at Walsall's Bescot stadium.
The football club's state ment in full read: “Coventry City Football Club Holdings can confirm that a non-operating subsidiary of the Club has today been placed into administration.
“It is important to stress that the football club itself is not under threat. Thi is merely a property subsidiary which owns no material assets and has no employees, on or off the pitch.
“The Club can c confirm that all staff wages, Paye and all other creditor commitments will continue to be met as before by Coventry City Foot ball Club Holdings.
“Unlike other instances of clubs being taken either wholly or partially into ad ministration, there are no HMrC or VaT implications and the Football Club will continue to trade as normal without interruption.
“our main objective now is to remain competitive on the pitch and give steven Press ley and the playing staff our full backing and commitment.“
The eleventh-hour move was intended to prevent aCL succeeding in its High Court bid to force the sky Blues into administration over £1.3million rent arrears * a hearing that is still set to take place today in some form.
aCL, in applying to the High Court for an administration order on the football club, had said the move could force a takeover of the club * forcing out its hedge fund owners sisu. d owners sisu.
aCL * jointly owned Coven try City Coun cil and the alan edward t Higgs Chari ty * had lined up Brendan Guilfoyle, of sheffieldbased P&a Partrship to take nership to take over the running of the club but the club last night appointed rubin & Partners as its administrator instead.
It is understood that it was able to do this after a “qualifying floating charge“ was put in place last March by sisu's Cayman Island-based subsidiary arvo Master Fund, the vehicle through which investment was made into the club, effectively making it the club's main creditor. speaking last night, Mr Guilfoyle said: “I'm being proposed as the administrator by aCL at a hearing tomorrow, but there is a possibility that arvo Master Fund Ltd may appoint an administrator of their choice.“
If aCL successfully challenges the latest legal move and is able to put the whole club into administration, Mrs Justice Proudman would first need to rule the club is insolvent and it is known that the club has been running at a loss for a number of years.
Many fans fear the club's entire future is at stake * with liquidation suggested two weeks ago by sky Blues chief executive Tim Fisher.
Today's hearing brings to a head a year-long dispute since the sky Blues began refusing to pay monthly £100,000 rental payments last april.
Talks over sisu acquiring stadium part-ownership collapsed months ago when the council in January bought out aCL's mortgage with yorkshire Bank to prevent the sky Blues' rent withdrawal pushing aCL towards administration.
aCL formally ended negotiations last month with sisu over a final offer to cut the £1.2million annual rent to £400,000, and pay back rent arrears over several years.
